WASHINGTON, DC – When Ministers meet for the IMF’s Spring Meeting this month they will find an institution with regained self-confidence. The London G20 summit gave a strengthened mandate to the IMF, while tripling its resources. More concessional finance will be available for low-income countries, and international liquidity will be increased by a hand-out of $ 250 billion in special drawing rights (SDRs). This is a boost for the IMF, and it gives hope to emerging and developing countries that have been severely hit by a crisis that originated elsewhere.
The IMF is well-positioned to help its members overcome the financing gaps resulting from the crisis. In the run-up to the G20 summit access to the Fund’s credit facilities was increased and policy conditions were streamlined. In a watershed with former practice, a new non-conditional credit line was introduced for well-performing countries. Mexico and Poland will be its first users and more countries will line up. These more flexible lending policies reflect a new image of the IMF. The negative stigma attached to IMF financing is a thing of the past.